IndiQube, a Bengaluru-based managed workspace provider, has taken a major step toward growth by filing a draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). IndiQube plans to raise Rs 850 crore through its initial public offering (IPO).
The IPO will consist of two parts: a fresh issue of shares worth Rs 750 crore and an offer for sale (OFS) of Rs 100 crore by the company’s co-founders, Rishi Das and Meghna Agarwal.
Details of IPO
The fresh issue of Rs 750 crore will bring new funds to the company, while the Rs 100 crore OFS will involve Rs 50 crore each from the two co-founders. Notably, no external shareholders are participating in the OFS, highlighting the founders’ significant role in the offering.
The equity shares from the IPO are expected to be listed on both the National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE).
IndiQube Shareholding
IndiQube’s current ownership structure reflects a mix of founders and investors. The key shareholders include:
- Anshuman Das: 25.32% (largest shareholder)
- Aravali Investment Holding: 22.07%
- WestBridge Capital: 5.79%
- Carenet Technologies: 5.15%
- Hirepro Consulting: 2.15%
- Co-founders Rishi Das and Meghna Agarwal: 37.92% combined
WestBridge Capital and Ashish Gupta are among the notable backers of the company, which was established in 2015.
How IndiQube Plans to Use the Funds
IndiQube has outlined specific plans for the funds raised through the IPO. According to the DRHP, the company intends to allocate the proceeds as follows:
- Rs 462.6 crore for setting up new workspace centers
- Rs 100 crore for repaying or prepaying certain borrowings
- The remaining funds will be used for general corporate purposes
ICICI Securities and JM Financial are serving as the book-running lead managers for the IPO.
IndiQube’s Presence in the Market
IndiQube is a leading player in the flexible workspace market in India. As of June 30, 2024, the company manages 103 centers across 13 cities, covering 7.76 million square feet. It offers a total seating capacity of 172,451.
The company caters to a wide range of clients, including global capability centers (GCCs), Indian corporates, unicorn startups, and small businesses. Its flagship offering, IndiQube Grow, provides plug-and-play workspaces with services such as interiors, technology, facility management, and value-added features.
IndiQube also operates four other verticals to meet diverse client needs:
- IndiQube Bespoke: Customized workspace solutions
- IndiQube One: High-end corporate offices
- MiQube: Tech-enabled smart workspaces
- IndiQube Cornerstone: Specialized workspace solutions
Financial Performance
IndiQube’s financial performance reflects its growth trajectory but also highlights challenges. Key financial details include:
- Q1 FY25 revenue: Rs 242 crore, with a loss of Rs 42 crore
- FY24 revenue: Rs 830 crore, up from Rs 580 crore in FY23
- FY24 losses: Rs 341 crore, higher than Rs 198 crore in FY23
- FY24 total income: Rs 867.6 crore, compared to Rs 601.2 crore in FY23
- FY24 EBITDA: Rs 263.4 crore
- Q1 FY25 EBITDA: Rs 153 crore
Board Expansion
IndiQube has recently strengthened its board by appointing four independent directors, including one woman independent director. The new members bring a wealth of experience to the company:
- Naveen Tewari: CEO and founder of the InMobi Group
- Avalur Gopalaratnam Muralikrishnan: A finance expert with 35 years of experience
- Rahul Matthan: Partner at Trilegal with 30 years of legal expertise
- Sachi Krishana: An HR professional with 20 years of industry experience
Flexible Workspace Market in India
The demand for flexible workspaces is growing in India, driven by hybrid work models, cost efficiency, and scalability. A report by CBRE highlights that flexible workspace stock in India has surpassed 79 million square feet, with Tier 1 cities accounting for about 72 million square feet. This figure is expected to reach 124 million square feet by the end of 2027.
Bengaluru leads the flexible workspace market in Tier 1 cities, with over 30% of the total stock. IndiQube plays a significant role in this market, operating 60 centers in Bengaluru, covering 5.04 million square feet.
IndiQube’s Rs 850 crore IPO marks a significant milestone in its journey to expand its presence in India’s flexible workspace market. With a strong focus on growth, the company plans to use the funds to set up new centers, reduce debt, and enhance its services.
As flexible workspaces continue to gain popularity, IndiQube is well-positioned to capitalize on this trend and strengthen its market leadership. The IPO will not only provide the company with the necessary funds but also pave the way for further innovation and expansion.
